Obama Brought Student Loans into the Department of Education

Linda McMahon: "The people in the Department of Education were really involved with student loans. And you know, student loans used to be in the private sector. It was President Obama who brought them in and placed them under the Department of Education. Which is not a bank. So the whole collection process, etc., is handled through third-party providers that you pay a fee to for helping make that happen.

So, my perspective—and I’ve had good conversations with Secretary Besson and also with the President, and Scott Besson and I have had conversations with Kelly Loeffler from the SBA—is whether there is some mechanism that can be implemented to improve this. And in terms of the collection process, etc., the Treasury does it very well. And clearly, from Scott’s perspective, there is a strong case that this would be the place to manage new loans in the future. We could consider looking at the SBA for some kind of guaranteed program, but that’s really for future discussions. First and foremost, we want to ensure that this collection process is working because, believe it or not—and I know COVID messed things up—but since March 2020, right around the time of COVID, there has been no collection on outstanding student loans.

And why would they have? The Biden administration was saying they were going to forgive their loans, right? They tried to bypass, you know, the Supreme Court and its rulings to forgive more loans. And it’s simply not fair to all taxpayers to have them pay for student loans when they might have paid their own or their tax dollars should be spent in other ways instead of forgiving loans—except, you know, for service agreements that Congress has approved. So, for those in public service, like teachers or first responders, a certain amount of payment goes toward their loans, and once those payments have been made, then they are allowed to be forgiven. We're talking about 10 years and consistent payments for that."